Microsoft and GameStop stock prices grow in 3Q

A Microsoft announced a 19% annualized revenue growth for the third quarter, which ended on March 31.

It is the company’s most considerable quarterly growth released since 2018. The change is partly because of PC sales growth due to shortages caused by the coronavirus last year.

The company said its Azure public Cloud, which competes with market leader Amazon Web Services, grew by 50%. Surprisingly, it was higher than analysts’ expectations of 46%. In the last quarter, Azure’s revenue increased by 50%.

Microsoft expects its fourth-quarter revenue to be between US$43.6 billion and US$44.5 billion. In the middle of the range, this represents a 16% increase.

Microsoft’s intelligent cloud division achieved $15.12 billion in revenue in the third quarter. It is an increase of 23% over the same period last year and higher than FactSet’s consensus estimate of $14.92 billion. Intelligent Cloud includes Azure, Windows Server, SQL Server, Visual Studio, GitHub, and Enterprise Services.

The productivity and business process departments, including Office, Dynamics, and LinkedIn, contributed $13.55 billion in revenue, increasing by 15%, exceeding the FactSet consensus of $13.49 billion.

The company’s more personal computing divisions, including Windows, games, devices, and search, achieved $13.04 billion in revenue. It is an increase of nearly 19%, which is higher than the market consensus of US$1.255 billion.

Microsoft’s sales of Windows licenses to PC manufacturers also increased by 10%. Now, more than 1.3 billion active devices are running the Windows 10 operating system every month.

Shares of Microsoft’s multi-year partner GameStop also rises on Monday

Generally, GameStop Corp’s prices significantly surged after starting the partnership with Microsoft last year. Through this partnership, game retailers can develop their physical and digital video game products and build their retail infrastructure.

GameStop Corp raised $551 million through a stock offering, and its stock rose 15% in an extended transaction on Monday.

The company was at the center of a trading frenzy promoted by Reddit earlier this year. According to GameStop,  the company has sold 3.5 million securities.

The average price of the shares sold was $157.43. The retail investors were pushing up the price of a large number of short stocks. Due to that, the company’s stock price has risen by more than 850% this year.

GameStop said earlier this month that George Sherman would resign as its chief executive officer. He will carry out the retailer’s most extensive management reorganization, thereby giving its largest shareholder Ryan Cohen more control.

Cohen’s RC Ventures owns nearly 13% of GameStop. He’s leading the company’s transformation into an e-commerce company that can compete with technology retailers like Walmart, Microsoft, and Sony.